Pernee Insights — Where Knowledge Meets AI

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The IRS told preparers to bill less for AI. The AICPA says the savings aren't free.

In June the IRS told tax preparers to credit clients for whatever AI actually saves them, through lower fees. In September the AICPA formally asked the IRS to clarify that instruction — arguing it ignores what AI costs the firm before any hour is saved.

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Form 1099-DA arrived. It skips the number that matters.

Form 1099-DA started reporting gross proceeds on digital-asset sales for the first time this filing season — and, per Treasury's own phased timeline, without cost basis. A reviewer who treats it like a 1099-B is one step from signing off on the wrong gain.

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The Tax Court spotted three citations an AI invented. Nobody else did.

On February 9, 2026, the U.S. Tax Court found that three of the four cases cited in a taxpayer's brief don't exist — invented, the judge concluded, by a large language model. It didn't sanction anyone. This is what nobody checked first, and what already requires someone to.

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The IRS just wrote tax preparers a rulebook for AI. It doesn't say to tell the client.

OPR Alert 2026-19 maps a practitioner's existing Circular 230 duties onto AI-assisted tax work — due diligence, competence, honest billing, client confidentiality. It never asks the practitioner to tell the client AI was involved.

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The IRS can now prove a return was filed on time. Not that it was right.

IR-2026-97 gave taxpayers a digitally verifiable filing-and-payment history. It confirms compliance, not accuracy — which is exactly the gap tax return review exists to close.

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What the IRS's new AI governance policy means for tax teams

On August 10, 2026, the IRS wrote itself a rulebook for using AI: a named accountable official, a documented risk determination for every use case, and a written approval on file for any exception. Most CPA firms adopting AI for tax review have none of that on paper — here's what to borrow from it.

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IRS notices are moving into the client's portal, not your mailroom

IR-2026-87 expanded the digital notice library in Business Tax Account. The notices are the same; the delivery path is not — and most firm intake processes still assume a client forwards an envelope.